2011 Winter Issue

COVER STORY
Why brands
love outlets
Plus:
Sales, footfall growth continues
European Outlet Conference recaps
Percassi opens a center in Sicily
SIcilia
Opening
Value Retail’s Fidenza Village
Four outlet chains honored
Sterboholy expansion opens
And much, much more…
ALBERTA FERRETTI
ARMANI
BALL ANT YNE
BLUMARINE
BOTTEGA VENETA
BRIONI
BROOKS BROTHERS
BULGARI
BURBERRY
COSTUME NATIONAL
DAMIANI
DOLCE & GABBANA
ERMENEGILDO ZEGNA
ESCADA
ETRO
FENDI
GUCCI
HUGO BOSS
JIL SANDER
JOHN RICHMOND
KENZO
L A PERL A
MARNI
MISSONI
MONCLER
MULBERRY
PAUL SMITH
POLO RALPH L AUREN
PRADA
ROBERTO CAVALLI
SERGIO ROSSI
TAG HEUER
TRUSSARDI
VALENTINO
VERSACE
joy
is reaching even
more consumers
Our 19 designer outlet villages across Europe offer the world’s
leading brands to over 75 million customers a year, representing
the most profitable way to sell excess stock in a stylish environment.
And our programme of expansion means we have room for more.
To find out how we can help your business improve cashflow,
contact Victor Busser on +44 (0)20 7535 2300 or
v.busser@mcarthurglen.com
www.mcarthurglengroup.com
CONTENTS
Winter 2011
Vol. 7 No. 1
PAGE 4
STaFF
William s. Taubman
ICSC Chairman
Michael P. Kercheval
ICSC President and CEO
Rudolph E. MIlian, scsm, scmd ICSC Senior VP
ICSC EUROPE
London, +44 20 7976 3100
icsc.europe@icsc.org
ICSC/IOJ
2519 N. McMullen Booth Rd.
Suite 510-356
Clearwater, FL 33761
+1 727 781 7557
Linda Humphers
Editor in Chief ext. 3
lhumphers@icsc.org
Randy Gdovin
Art Director ext. 4
rgdovin@icsc.org
Karen Knobeloch
Advertising Prod. Mgr. ext. 2
kknobeloch@icsc.org
Sally Stephenson
Senior Advertising Executive
+1 847 835 1617
Fax: +1 847 835 5196
sstephenson@icsc.org
International Outlet Journal is a publication for the non-U.S. factory outlet industry. Copyright © 2011
PAGE 14
PAGE 18
Inside
4
6
Fashion House re-Groups
Outlet sales continue growing
European outlet Conference recap
8
9
9
10
10
10
12
State of the European outlet industry
Opening stores in emerging markets
Brands change their attitudes
Marketing: Does it work?
When clicks meet bricks
Desigual, Lindt talk expansion
Spotlight on China, Russia, Egypt
13
14
16
18
19
22
22
RECon Asia’s outlet offer
Sicilia Fashion Village opens
Athens Designer Outlet and more
Sterboholy expansion opens
New project updates
Four brands honored
Trade report: Italy gains speed
Advertiser Index
Fashion House...................................... BC
Henderson Global Investors................ IBC
McArthurGlen.......................................IFC
Neinver.................................................. 11
Value Retail............................................. 5
VRN Subscriptions................................ 17
WI NT ER 2 0 1 1 I nt e r nat i o na l O u t l e t J o ur n a l
3
Up Front
Restructuring creates
new Fashion House
A
restructuring of Fashion
House Development has led to a
new one-stop, fee-based development entity for investors and landowners
looking to enter the outlet sector.
Fashion House Group is the new entity, formed in early December 2010, to
provide consumer and B2B marketing,
leasing, staffing, project management,
asset management, tenant coordination,
debt funding consultancy and brokerage. FHG also offers investor exit and
disposal services.
Although clients and staff say the
changeover is seamless, the route to the
new entity is a little confusing. In the
beginning there was UK-based GVA
Grimley Outlet Services and Flemish
developer Liebrecht & Wood, which
jointly owned Fashion House Development (FHD). GVA managed and
operated FHD and other outlet properties. On December 9, 2010, Liebrecht
& Wood (L&W) acquired GVA Outlets,
so now Fashion House Group is under
one roof. The strands of the new entity
include:
l GVA Outlets, which will continue
to manage and operate non-Fashion
House branded centers
l Fashion House Development,
which includes the projects developed
by L&W
l Fashion House Franchise, which is
a new division to handle fee-based development for investors and owners
Brendon O’Reilly, former managing
director of GVA Outlets, is now managing director of Fashion House Group.
Neil Thompson, former CEO of Fashion House Development, is now chief
commercial officer of FHG..
The staff of the newly structured
Fashion House Group have worked together for several years to develop four
outlet centers in Central and Eastern
Europe – three in Poland and one in
Romania. Fashion House Group is now
developing centers in Belgrade, Serbia,
set to open in fall 2011, and in Kiev,
Russia, set to open in spring 2012. Fash4 I n ternational Ou tle t J ourn al WINTER 2011
When Fashion House Bucharest opened in December 2008, more than 55,000 brandhungry shoppers jammed the Romanian center.
ion House also has sites selected for
seven other outlet centers in Russia.
O’Reilly explains the new company’s
proposition as a way for newcomers to
safely enter the outlet sector.
“Attractive and dynamic as it is, the
outlet-center sector can be difficult, and
in some cases disastrous, for independent developers to enter without expert
knowledge,” he says. O’Reilly notes
that many independent projects either
never open or open at considerable cost
because of the long line of third-party
suppliers, consultants, architects, leasing
agents and others required to develop
an outlet center.
O’Reilly says Fashion House Group
might be the first company in Europe
to offer soup-to-nuts services for
outlet development. There aren’t many
such companies – in the U.S., most
consultancies offer either leasing or
marketing or sometimes both. Occasionally an experienced outlet developer will partner with a landowner.
One U.S. company, the Skye Group,
recently expanded its project management and tenant coordination services
to include asset management. Otherwise, the business model that FHG is
implementing is unusual in the retail
development sector.
Despite the newness of the concept,
Fashion House has a portfolio to back
up its claims.
“Unlike many outlet consultants,”
O’Reilly says, “we can actually take
prospective clients to our centers, let
them talk to the team and the customers, show them our results in the short,
medium and long term and let them
decide how good we are and which option would work best for them.”
Fashion House was founded several
years ago when Liebrecht & Wood and
a group of Belgian and UK investors
acquired three outlet sites in Poland.
GVA Grimley Outlet Services was hired
to handle management, leasing and operations. Together they opened Fashion
House Outlet Centres in Sosnowiec,
Gdansk and Warsaw. Once all three
were open, they were sold to AIB’s Polonia II Property Fund for €45 million,
with Fashion House remaining as the
asset manager.
The Fashion House centers in Poland
opened in 2004 and 2005, with Fashion
House Bucharest opening in December
2008. Phases have been added to each
of the Polish projects and a second site
is planned in Bucharest. c
THE
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Outlet PERFORMAnce
Global shoppers
boost VR’s
Chic Outlet sales
Value Retail’s Chic Outlet Shopping Villages scored some double-digit
growth in Q3 2010. That growth was
achieved by an 81 percent increase in tax
refunded sales during the period, July
through September.
For the second successive quarter, tax
refunded sales – which account for 9 percent of all sales in the nine-center portfolio – increased by more than 50 percent
compared to the same period in 2009.
Those sales to non-EU shoppers have
been dominated by two markets: China
(+95 percent) and the Middle East (+55
percent). However, the fastest growing
market share continues to come from
Russia (+98 percent), which has almost
doubled since 2009.
The average spend per tax refunded
transaction in Q3 was €287, a 10-percent
increase compared to the same period in
2009. Shoppers from the U.S. recorded
the highest average spend – €318 – up 8
percent compared to 2009.
Value Retail attributes the strong results
to a number of factors, most certainly
the brands in its nine European outlet
centers, but also the partnerships the
Value Retail’s Chic Outlet Shopping Villages, including Fidenza Village (above), have
been especially attractive to international shoppers this year.
company has forged with the global
travel industry. The developer works
with Tour Parade and Chaika in Russia; Al Rais Travel and Etihad Airways
Holidays in the GCC (Gulf Cooperation
Countries of Bahrain, Kuwait, Oman,
Qatar, Saudia Arabia and the United Arab
Emirates); Sino-America Tours, ASA
and CTC Holidays in Singapore; Holiday
Tours & Travel, Mayflower Acme Tours
and Golden Tourworld Travel in Malay-
Stable International’s Batavia Stad Outlet Shopping in Lelystad, the Netherlands, has once again recorded double-digit growth. Turnover has increased by
15 percent and the average transaction has grown by 11 percent, year to date
through October, the last date available for comparison. Helping to drive those
increases is the 277,500-sf center’s customer loyalty program. Launched January 2010, there were 60,000 members as of November 1. The target is to reach
100,000 members this year.
6 I n ternational Ou tle t J ourn al WINTER 2011
sia; and Jalpak and Tabi Kobo in Japan.
Additionally, ChicOutletShopping.com
is available in 11 languages (English,
French, Spanish, Catalan, Italian, Flemish, German, Japanese, Russian, Arabic
and Simplified Chinese), which helps
reach just about anyone who wants to go
outlet shopping in Europe.
Extensive study
shows DOW
benefits Wolfsburg
One of the most extensive studies
for a German retail project was recently
conducted, proving that an outlet center
and a city center can and do strengthen
each other.
The study, conducted throughout
2009, evaluated the impact that Outlet
Centre International’s Designer Outlets Wolfsburg (DOW) has had on the
Wolfsburg city center.
The detailed results confirm that
DOW has helped connect the city of
Wolfsburg to local tourism destinations.
DOW has a larger catchment area than
the city, thus, visitors are coming to
Wolfsburg who would otherwise never
have travelled there. In return, some
city-center visitors and customers are
also coming to the outlet.
Highlights of the study:
Customers and visitors perceive the
designer outlets Wolfsburg as an independent tourist attraction. About half
of the interviewees at DOW said they
The 258,000-sf Palmanova Outlet Village has been posting double-digit increases in sales and footfall, thanks to its location on the
Italian border near Austria, Slovenia and Croatia.
were day-trippers, on holiday or business
travelers, compared to 15 percent in the
city center.
Sunday openings at DOW are having
no negative effect on the city center, as
many shoppers mainly browse that day.
Apparently the habit of spending money
on Sundays hasn’t set in yet .
The survey also showed that the architectural style of the 100,000-m2 DOW
has set a benchmark for the whole city
center of Wolfsburg, but each additional
outlet center within the catchment could
reduce this positive effect.
The study was conducted in four
week-long surveys of passers-by at
three locations – two in the city center
and one at the designer outlets Wolfsburg. In total, about 8,000 people were
surveyed. The weeks chosen as survey
times overlapped Sundays and holidays
to better judge the impact of DOW on
Wolfsburg’s city center.
Palmanova center
thrives on traveling
shoppers
Palmanova Outlet Village posted
high numbers in 2010, with turnover
increasing 25 percent and footfall 16
percent through August.
The steadily growing success of the
258,000-sf center, which is in Udine,
Italy, overlooking the A4 Venezia-Trieste
motorway, is a result of location, traveling shoppers and motivated tenants,
according to Charles Maffioli, president
of Promos Group, which operates the
two-year-old center.
Palmanova, which is on the border
between Italy, Austria, Slovenia and
Croatia, has a distinctly international
character with 40 percent of its shoppers coming from outside Italy. c
More than 20,000 shoppers turned out for the Late Night Shopping Bonanza held
December 5 at McArthurGlen Group’s Designer Outlet Salzburg in Austria. Shoppers
were drawn to the 301,000-sf mall’s late closing – 11 p.m. instead of the usual 6 p.m.,
by such activities as beauty makeovers, a magazine cover shoot and a fashion show
(above) featuring 14 top models. The event gave the center its best sale’s day since it
opened in September 2009.
WI NT ER 2 0 1 1 I nt e r nat i o na l O u t l e t J o ur n a l
7
EOC recap
Why brands
love outlets
Speakers at the fifth
European Outlet
Conference delved into
the industry’s appeal.
C
onsumers around the world
have discovered that if there’s
one plus to the down economy, it lies in the discovery of outlet
shopping. Known to be continually
productive when consumers need
bargains but don’t want to give up
on the quality, brands and selection
they’ve grown to expect, the outlet
channel has blossomed in the past
two years. And that’s “why brands
Moderator Richard
love outlets,” the theme
Beasley,
managing
of the 2010 European
director of LondonOutlet Conference.
based BWP Group, led
Held in October 2010
the discussions, panels
in Milan, more than
and presentations from
200 registrants from
investors, retails and
26 countries convened
landlords on expansion
for the European outplans, marketing stratlet industry’s fifth conegies, capital funding,
ference. The two-day
exclusive research and
meeting was hosted
Beasley
much
more. Recaps
by ICSC and IOJ and
sponsored by Henderson Global of the 2010 European Outlet
Investors, Aareal Bank Group, Conference will be reported in
CBRE and Corio. Platinum spon- this issue and in the Spring 2011
sors for the two-day event were IOJ . The first summaries filed by
GVA Grimley Outlet Services and IOJ’s Berlin corespondent Stephanie
Kramer follow.
Fashion House Development.
State of the
European Outlet
Industry
B
rendon O’Reilly, managing di-
rector of Fashion House Group
(see page 4 for related story), kicked
off the first session with a look at the
state of the European outlet sector after
the recession. “This is the first financial
crisis for outlets in Europe,” O’Reilly
said. “Because the European outlet sector did not start up until after the 1992
recession, this was the first to hit the
industry. The question is: will we see a
more loyal customer? Given that outlet
spending is countercyclical, will cost-conscious European shoppers keep coming
back even after the crisis? My theory is
‘yes’ – that this is a future opportunity.”
The recession has affected consumers, but there have also been repercussions for tenants, developers and operators. “Tenants are more cautious,” he
said, “They are analyzing existing stores
8 I n ternational Ou tle t J ourn al WINTER 2011
Brendon O’Reilly
Joachim Will
and are more careful about opening
new ones. Leasing uptake has slowed.”
Existing outlet centers have done
well, he said, but debt financing for new
projects has changed completely; there
are more landlord/tenant discussions to
change lease terms, and there are fewer
transactions.
O’Reilly said there are 143 successful
outlet centers operating throughout Europe, with the pipeline for new projects
moving eastward into Eastern Europe.
The UK is virtually saturated and in all
likelihood there will be no new centers
opening there between 2010 and 2012.
Yet elsewhere in Europe, annual new
openings may be expected to pick up
again between 2010 and 2012.
Germany, in particular, which O’Reilly
said is the “jewel in the crown,” is well
below saturation, with currently only six
outlet centers.
Joachim Will, CEO of the market
research firm Ecostra, substantiated
O’Reilly’s remarks. “When brands were
surveyed,” he said, “the greatest potential for outlet stores in the next three
years was in Germany.”
We’re opening a
store -- where?
I
n the next decade, emerging mar-
kets are expected to help fuel strong
growth in luxury consumption, and
many consider these markets to be a
key aspect of outlet strategy and policy.
“My personal forecast,” said Armando
Branchini, secretary general of Fondazione Altagamma, “is that by 2020 we
may expect to see 10 percent growth
year-for-year in emerging markets and 4
percent in mature markets.”
Yet he cautioned, “although new
stores must be built in emerging markets, they must be opened in tourist
destinations.” In Western Europe, tourist purchases of luxury goods already
often outpace those of local residents.
In Italy, Chinese tourists are the top
purchasers of luxury goods, followed
by Americans; in the UK, tourists from
Asia and the Middle East have the highest luxury goods consumption.
“The question is not where,” said Carmine Rotondaro, worldwide real estate
director of Gucci Group. “The question
is which store where.” Citing Japan as an
example, he said in that country “there
is almost hyper-awareness of brands. So,
in Japan novelty is key.” There Gucci is
now trying out an innovative approach
with an “artisan’s corner” where items
can be personalized.
Online purchases are another “where”
issue. The Internet presents what Rotondaro referred to as a “challenge of
content” for retailers.
“The Web does not go through the
hands; it goes through the head,” Rotondaro said. “The quality of a product
– the feel of the product – is hard to
From left Victor Busser, Carmine Rotondaro and Armando Branchini
appreciate on a computer screen.”
In the Internet era, he believes, the
notion of “heritage” may have special
importance. “Heritage is key for major
brands. Heritage represents quality. It
becomes capital,” he said. Now, instead
of marking down past collections, the
reverse is happening: special editions
of past collections are being expressly
made for customers now.
Rotondaro also called on the outlet sector to react. “We need better partnerships
with brands. Outlets must share capital
with brands.” Brands for their part will
continue to find outlets to be an attractive
avenue because they allow the brands to
communicate through their stores.
Victor Busser, European leasing director for McArthurGlen, the largest outletcenter developer in Europe, agreed that
the attitude of brands toward outlets has
changed. Luxury brands are less averse
to the idea than they previously were,
but they must be present in full-price retail first. Still, he confirmed that “luxury
brands need security.” Outlets provide
the luxury-goods customer a different
experience, but it still must be an experience of that brand.
From left Vincent De Wavrin and Roy Carter
Retailers’
Corner
T
he attitude of retailers toward
outlets is changing, said Vincent
De Wavrin, outlets director of Petit
Bateau. “In the beginning we had an opportunistic approach. Retailers saw outlet
centers as a place to offload excess stock.
Over time that has changed. We moved
from thinking about what to do with
excess stock toward producing for outlets.
Also the manufacturer became a partner
because we used leftover material. So the
brand benefits; everyone benefits.”
What, then, are the criteria for opening an outlet store? What do retailers
consider the most important ingredient
– catchment area, brands, operator?
“The operator is crucial,” De
Wavrin said. “People used to think that
anybody with money could open an
outlet center. Now we know - not just
anybody can do it.”
Also, at Petit Bateau there is a strong
focus on opening outlets within Europe,
mainly in France and Germany. Although the company is open to other locations, Petit Bateau has only corporateowned stores - no licensee stores - and
would not open in a country without a
subsidiary due to management issues.
As outlets spread across Europe,
however, they are being built closer
to cities, giving rise to concerns about
cannibalization. Retail consultant Roy
Carter acknowledged that this is an issue, but said it is only a problem initially.
“Full-price stores may at first lose up
to 20 percent of sales,” he said, “but
(Continued on page 10)
WI NT ER 2 0 1 1 I nt e r nat i o na l O u t l e t J o ur n a l
9
EOC recap
(Continued from page 9)
(Continued from page 9)
they recover over time. Also, stores that
are present at outlet centers can attract
aspirational customers who wouldn’t buy
the brand at full price.”
De Wavrin agreed, adding that “Petit
Bateau is so familiar in city centers that
people expect to see the stores there, and
customers continue to do their shopping
in the city center.”
Marketing:
But did it work?
“T
here is no one formula”
for a successful marketing
strategy, said Mark Clark,
head of business development and
communications for GVA outlets. “New
outlets need big numbers and a big media message.” For new locations or new
brands, he continued “do a few things
and do them well. Only after seven to
nine centers have opened can you begin
to think about how little can you spend
to keep them going.”
With more established outlets, said Clara
Petrone, regional marketing manager at
McArthurGlen, communication with
center managers is essential. Marketing
workshops, for example, can help identify opportunities and develop marketing activities.
“The key is to define a clear objective,”
Petrone continued. “Developers must
know who they’re targeting. They also
have to be clear about the goals of any
marketing campaign, whether these are
to increase footfall, average spending, or
brand awareness.”
Depending on the site, said Luigi
Maurizio Villa, retail operations director at
Palmanova Outlet Village, marketing needs
to address international and seasonal shoppers with special marketing strategies.
Another important task, according
to Natalie McLean-Reid, managing
director of Primal PR, is to educate the
media. “By educating local journalists,
you also teach consumers.”
Investors must also be well-informed
about marketing budgets. Citing his own
experience, Maurizio Villa said, “Investors say, ‘the center is successful, now we
can cut back on marketing.’ They have to
be taught to understand that you don’t
begin cutting the budget because the
center is doing well.” On the contrary,
10 I n te rnational Ou tle t Journ al WINTER 2011
From left Maurizio Villa, Clara Petrone, Natalie McLean-Reid, Anthony Sutton and Mark Clark
marketing spend must be continued at a
high level for several years.
According to Anthony Sutton, center
director of Dockside Kent Factory Outlet,
marketing strategies should be continually
adapted to the current situation. “For a
new center, footfall is crucial. Then comes
the struggle to bring in bigger brands.”
He also advised frequent, regular meetings between retailers and center managers.
How clicks
complement
bricks – selling
efficiently on
the web
“E
bay isn’t going to go
away, so you have to
think about how it can be
complementary,” said Patrick Munden,
head of seller communications for
eBay. The company that started out as
a “niche player,” selling collectibles on
the Internet, took off rapidly after 2005
with the introduction of high-speed Internet connections.
Since then, there
has been a major
shift in buyer profile and categories.
What started out as
a site visited mainly
by men looking
for electronics has
undergone an enorMunden
mous transformation. In the past five years, the number
of women visiting the site has increased
dramatically and fashion has shown the
greatest growth.
Some 92 million people worldwide use
eBay. In the upcoming years, eBay plans
to pursue various strategies for targeting
multi-channel customers. Nearly every
major brand now has an online presence, and vertical shopping and the use
of mobile devices are two important
trends that will increasingly affect how
people shop. Ebay’s outlet presence was
launched one year ago.
“Just in the UK alone,” said Munden,
“one pair of shoes is purchased every
few seconds on Ebay.”
Munden said that although e-tailing
may steal 14 percent of sales from bricks
and mortar, 11 percent of offline purchases are initiated online.
Ebay may also be viewed as complementary to bricks and mortar in the
sense that it increases consumer awareness and is a form of advertising for
products that customers want to look
at, but not purchase, online. There is
still the often-cited fact that people
want to touch the product. Catalogs
were a well-known earlier form of
multi-channel retailing, and they have
been anything but the death of outlet
shopping.
“At the end of the day,” Munden said,
“the entire retail pie is growing.”
Retail Runway
“D
esigual,” said Joan
Rouras, the retailer’s head
of real estate, “is a small
company with big ideas.”
The aim of this multi-channel business,
which includes wholesale, department
stores, retail, and franchise stores, is to offer unique clothing for individuals. “The
target shopper comes from all walks of
life, all ages and income,” Rouras said, “At
(Continued on page 12)
EOC recap
(Continued from page 10)
Desigual, we dress people, not bodies.”
About half of their stores are outlet
stores. Showing pictures of outlet store
interiors in Belgium and Spain, Rouras
explained that it
was important
that the customer
be able to identify
the brand in every
location. “Otherwise, it is not the
same shopping
experience for the
customer,” he said,
Rouras
adding that another
aspect that makes outlet shopping different is that “people have money to spend,
but not the time. Therefore, customer
service at an outlet center must be of the
same high quality as on high street.”
Desigual is following a four-part growth
strategy that includes outlet stores, outlet
events (for now-or-never purchases),
urban outlets for customers who cannot
get to out-of-town centers, and full-price
stores with an outlet area. With this strategy the company aims to reach the broad
cross-section of shoppers that it describes
as its target group. “The goal,” said
Rouras, “is to have one Desigual garment
hanging in every wardrobe.”
A
n
n
n
t Lindt, the personality is in
the chocolate. According to Pierenrico Barbesino, sales
and marketing director of SelectTrade,
which works in partnership with Lindt,
“What makes Lindt chocolate different
from any other
is the individual
effort that goes
into each chocolate. Each one is
a unique creation,
‘con personalita.’”
Nearly threequarters of
branded Lindt
Barbesino
stores in Italy are located in outlet centers. According to Barbesino, “A certain
‘wow’ effect is important for stores in
outlet centers because shoppers don’t
usually expect to find a chocolate shop
there. If shoppers buy chocolate at an
outlet center, it is an impulse buy.”
During the summer months, the
stores also sell ice cream, and during the
winter, hot chocolate drinks made of
Lindt chocolate are on offer – complete
12 I n te rnational Ou tle t Journ al WINTER 2011
with a chocolate spoon.
Customer education is also key. “It is
important to let people experience premium chocolate,” explained Barbesino,
and to allow them to develop a taste
for exquisite chocolate. “The customer
isn’t walking into a bar,” he said. “The
customer is entering a Lindt world.”
Spotlight on
China, Russia
and Egypt
“C
hina is on fire,” said
Chris Milliken, commercial
director of Freeport, “but
it is easy to burn your fingers.”
China has about one-fifth of the
world’s population and within a decade
is expected to be the world’s largest
economy. Despite
intense interest in
the region, this potential outlet haven
also has some significant drawbacks,
he said.
Government
ownership of land
and proper center
Milliken
management are two major hurdles.
Also, about 80 percent of the population
has to be written off as potential outlet
shoppers. Finally, there is the pervasive
and difficult issue of counterfeit goods.
But if outlet developers and retailers
are interested in China, China is also
interested in outlets. China is among
the top three markets in luxury goods,
second only to Japan, and ahead of the
United States. More than 25 so-called
outlet centers are already operating in
China, many of which are enormous.
One center in Shanghai boasts more
than 100,000 m2 . “If an outlet center
isn’t big in China, it may not even be
on the map,” Milliken said, adding that
China has considerable potential but
considerable risks, too.
n
n
n
In Russia, said Neil Thompson, CEO
of Fashion House Development, “outlets are the next logical step.”
The country has a population of 140
million, and three-quarters of its residents
live in urban areas. In the last decade Russians have embraced Western consumer
culture. Almost all luxury brands are
present. “People aspire to brands more
than they do in
the United States,”
Thompson said,
“and they are an essential part of outlet
shopping,” especially
since nearly half of
shoppers base their
purchasing decisions
Thompson
on brand names.
The cultural impression of a shopping
experience is also critical. “If people
are going to a place they have to travel
60 minutes to get to, they don’t want to
walk around outdoors,” said Thompson.
Mixed-use centers are also popular.
Yet outlet development so far is “scattered and improvised,” Thompson said.
Consumers still view designer outlets
as discount centers; there are problems
with licensing and franchises; and finally,
available data, for instance on turnover,
are often unreliable. But with the Russian
shoppers’ appetite for brands at bargain
prices, there is clearly potential.
n
n
n
Egypt, said Ibrahim Kamal, managing
director of Nile Stock, “isn’t quite ready
for an outlet center.”
But Nile Stock is taking the first steps
in that direction. The company originally
developed from a family-owned textile
business (Nile Tricot), which, faced
with excess stock,
opened the Nile
Stock factory outlets. There are now
a total of seven
outlets with a retail
area of 4,000 m2 .
Last year Nile Stock
launched Red Tags,
a 2,000-m2 flagKamal
ship department store, and the first of its
kind in Egypt, where shoppers can find
international brands at affordable prices.
Egypt is the most populated country
in the Arab world with 78 million people. With its robust economy, increasing
retail sales and an emergent middle class
and tourism, the shopping center culture is already firmly established. Since
2003 there has also been an influx of
international brands into the country.
“Although brand interest is increasing,” Kamal said, “it is still too soon for
outlet centers to operate successfully in
Egypt.” c
reCon Asia
RECon Asia draws
an outlet crowd
O
utlets were the focus of
attention at the ICSC’s 2010
RECon Asia, held November 7-9
at the Beijing International Hotel and
Convention Center.
By all accounts, “Outlets: Where Are
They Going in Asia?” was the most
widely attended of the educational sessions held at the three-day conference,
drawing an audience estimated at more
than 300 attendees.
Panelists of the 45-minute session
were John R. Klein, CEO, Premium
Outlets/Simon Property Group; Mark
Silvestri, SVP, Premium Outlets/
Simon Property Group; Richard Li,
EVP, Globe Outlet City Holdings;
John Chung, EVP, Globe Outlet City
Holdings; and Kan Chang, EVP, Urban
Retail Properties – Asia. Moderator was
Peter B. Leckerling, Managing Director,
Leto Commercial Consulting.
Leckerling,
whose firm brings
international retail
brands and real
estate developers
into the China
market, opened up
the discussion by
outlining general outlet trends
Leckerling
in Asia before going into more depth
regarding the China market, where he
sees enormous potential. Leckerling said
projects opening recently in China have
largely underperformed, but he explained
that the learning curve for Chinese firms
taking on outlet projects has been very
steep.
He added that outlet sites he had
recently visited demonstrated a better understanding of the fundamentals
necessary for successful outlet development. Furthermore, the quality and
success of the projects will continue to
improve as Chinese developers come to
the realization that outlet centers require
long-term ownership and high levels of
investment in ongoing management and
maintenance.
Klein and Silvestri, the only panelists that have actually opened outlet
centers in Asia, brought much-sought
experience and insight to the discussion, particularly on some of the key
factors for driving footfall. Simon has
opened eight outlet centers in Japan (in
Gotemba, Ibaraki, Kobe-Osaba, Rinku,
Sano, Sendal, Toki and Tosu) and one in
Seoul, South Korea.
Simon is developing two more
projects in South Korea (in Busan and
Paju) and one in Johor, Malaysia. The
ground-breaking in Malaysia was so
highly anticipated that it dominated
news there for days.
Globe and Urban presented three
new outlet projects that are in development in Mainland China.
Globe’s projects seek to open up two
of China’s so-called second-tier cities,
Qingdao and Changsha, while Urban’s
first foray into Chinese outlet development is in the more established market
of Shanghai. All three projects fall into
the mixed-use category, with Globe’s
projects being part of large master
plans that include residential buildings,
convention centers and hotels.
Urban Retail’s project (in partnership
with Shangtex, China’s largest textile
and garment manufacturer) combines
an outlet center with a large-scale fashion facility meant to launch Shanghai as
a bona fide fashion capital in Asia.
Urban’s Chang discussed one of
the more controversial aspects of the
Shanghai Fashion Center project – its
proximity to downtown. Chang admits
that some brands have expressed
concern about retail sensitivity to their
nearby wholesale accounts. He said,
though, the Chinese are less likely to
leave cities to go on shopping ventures,
so outlet centers can operate successfully in urban areas.
Conference attendees later said they
were encouraged to learn that major
American and European outlet developers are actively searching for sites and
partners in the China market. Cities
under consideration include second-tier
markets like Tianjin, Nanjing, Wuhan,
Dalian and Chongqing, where a lack
of quality projects to serve increasingly strong consumer populations have
created a real opportunity for outlet
developers.
Shanghai and Beijing already have
three strong outlet centers, and a
planned outlet project near the Disneyland Shanghai (scheduled to open
by 2014 in Shanghai’s Pudong District)
was of interest to brands attending the
conference.
Also heard at RECon Asia: a local
Chinese developer has decided to go
head-to-head with Bailian’s Shanghai
Outlets, opening a competing outlet
center across the street from Shanghai’s most successful outlet center – in
a slightly more convenient location in
terms of access from the highway. In a
land of no radius clauses, the battle for
dominance should be interesting. c
Information for this recap was
supplied to IOJ by moderator Peter
Leckerling and panelist John Klein.
WINT ER 2 0 1 1 I nt e r nat i o na l O u t l e t J o ur n a l
13
Sicilia outlet village
Percassi’s conquest:
Sicilia Fashion Village
The opening of the
Sicilian outlet center
represents more than
just another place
to shop.
T
he opening of Gruppo Percassi’s
€100 million Sicilia Fashion Village
on November 25, 2010, was seen as
the conquering of the last outlet frontier
in Italy.
The 270,000-sf Sicilia Fashion Village was developed by Gruppo Percassi through its
subsidiary Premium Retail. Percassi also developed Franciacorta Outlet Village in 2003.
14 I n te rnational Ou tle t Journ al WINTER 2011
Now, it appears, with this opening of
the first outlet center in Sicily, Italians
can relax in the happy knowledge that no
matter where they travel in their homeland they can go outlet shopping. In
fact, Italy has at least 19 outlet centers
totaling more than 5.5 million sf in 12
provinces. At least three more centers
are being planned.
But there’s another reason for seeing
the opening as a conquest. Vincent Viola,
a minority shareholder in the project, best
summed up the underlying feeling:
“Sicilia Fashion Village is proof that you
can make a big investment in Sicily free
from the grip of the Mafia,” he said. “This
is an initiative of private enterprise and
the transparent cooperation with the local
government. Development in this region
can come only through the private initiative
of large groups.”
Located in Agira, in the province of
Enna, the 270,000-sf center is on the
A19 motorway that connects Palermo to
Catania, near the exit Dittaino. Percassi
developed Sicilia Fashion Village through
its subsidiary Premium Retail, directed by
Stefano Stroppiana.
Stroppiana expects the center – which
opened with more than 70 luxury tenants
– to receive as many as 3.5 million visitors in the first year. Helping to attract
those shoppers is a schedule filled with
Located in Agira, the €100 million Sicilia Fashion Village expects to draw 3.5 million visitors in the first year.
free concerts and other events.
Additionally, Agira is in the heart of
the island’s spectacular lakes and castles
district, and Sicily itself draws 14 million
tourists annually.
The center’s architecture is inspired
by Sicilian Baroque, with ceramics and
mosaics created by artisans and master
craftsmen from Caltagirone. Its park-like
setting plays host to restaurants, pastry
shops, ice cream parlors and cafés, all set
among the flower beds, shade trees, and
pergolas, exactly the way Italians like to
blend eating and shopping.
Sicilia Fashion Village is a 70-minute
drive from Palermo, an 80-minute drive
from Messina, and a 90-minute drive
from Agrigento. c
SiciliA Fashion Village Tenant List
1911 Trussardi
Alessi
Alexander Nicolette
Angiolucci Occhiali
Baci & Abbracci
Bagatelle
Ballantyne
Bear
Bialetti
Billionaire
Botticelli
Boxeur des Rues
Brand by Dolce & Gabbana
Bruno Magli
Calvin Klein Collection
Camicissimo
Campanile
CK Jeans
Coccinelle
Conte of Florence
Corso Roma
Dirk Bikkembergs
Docksteps
Ermenegildo Zegna
Facis
Ferrari Store
Flavio Castellani
Freddy
From
Gant
Gas
Gattinoni
Gaudi
Giorgio Armani
Golden Point
Guess
Guru
Gutteridge
Hangar 18
Harmon & Blaine
I Giochi di Malu
John Ashfield
Kiko
La Casa Italiana
Lacoste
Legami
Loro Piana
Malloni
Malloy
Marina Militare
Marina Militare Kids
Meltin’ Pot
Modus
Moneta
Motivi
Motostore
Nike
Officina di Ricerca Kids
Patrizia Pepe
Piquadro
Pirelli
Pompea
Primigi
Rifle
Roncatto
Segue
St. Diego
Tailor Club
Toy G Pinko
Valleverde
Verri Uoma
Agrodolce
Versace
Yamamay
Planned Centers
New projects fill MCG’s plate
The developer is busy
with phase 1 outlet
projects in Greece,
Germany and France,
plus seven expansions.
M
about 40 percent pre-leased. Signed
tenants include Cavalli, Gant, Guess,
Lacoste, Luna, Moschino, Navy Green,
Replay, Tommy Hilfiger, Timberland
and Versace. In a recent survey nearly
half of Greek consumers claim to purchase only designer brands.
Architectural design has always been
important to McArthurGlen Group
chairman Joey Kaempfer. Thus, Athens
Designer Outlet adopts the region’s neoclassical style, using Greek mythology
symbols alongside the traditional triangular pediments atop Grecian buildings.
The layout of the center will include
tree-lined boulevards leading into a central square. The site is a former vineyard
in Yalou, 30 minutes west of Athens
city center and 15 minutes from Athens
International Airport. About 5 million
people live within a 90-minute drive.
“Our business is about what the
brands want to do,” Bond said. “And
they told us they want to be in Greece,
so we’re in Greece.”
under way at the center, which is in a
key tourist area, off the main motorway between Scandinavia and southern
Germany. A second phase offering
6,000 sq m of retail space will open in
2013. MCG also manages, markets and
leases Designer Outlet Berlin, which is
owned by Henderson Global Investors’
European Outlet Mall Fund.
n
n
n
cArthurGlen Europe, which
MCG said in November it would
will open its 20th outlet center
open its 22nd outlet village an hour
in May, already has its 21st and
nd
from Marseille, in the city of Miramas,
22 projects in the pipeline.
in the Bouches-du-Rhône. The 215,278The opening of the 230,000-sf Athens
sf center, which will open in 2014, is
Designer Outlet comes just as the Greek
between Aix-en-Provence and Arles, and
economy has bottomed out. But Gary
close to motorways that link Paris and
Bond, CEO of MCG Europe DevelopNorthern France with the Cote d’Azur.
ment, is confident the project will do
More than 4.6 million people live within
well, not only because outlets generally
a 90-minute drive.
prosper during economic slowdowns.
n
n
n
“All our centers have seen growth of
Despite the challenging economy,
15 to 20 percent every year,” Bond said
year-on-year sales and footfall in MCG’s
during an interview with Property Week
portfolio of 19 centers across eight
TV at Mapic in November.
European markets have increased by
“From a trading point of view, it
n
n
n
16 percent and 10 percent respectively.
doesn’t hurt us at all, in fact, it’s probMCG’s 21st outlet project, the
Business is so good that the developer
ably good news for us,” Bond said.
215,000-sf Designer Outlet Neumunis planning expansions to five existing
“We’re the value offer in a recession.
ster
near
Hamburg,
Germany,
will
open
centers this year, and two more expanPeople come to us looking for great
in
2012.
Leasing
is
reportedly
well
sions in 2012. c
value on great brands. The brands themselves, when they’re struggling
in their full-price stores, have
a lot of excess stock, so the
quality in the outlets gets better. From a trading standpoint,
we’re not worried at all.
“We are lucky we secured financing with the banks before
the real collapse happened,” he
added. “If we’d tried to secure
financing today, the banks
might have been nervous. But
now they’re very happy with
what we’re doing,” which includes creating 1,000 new jobs.
Construction of the project
began in 2009.
The €100 million project’s
investors include McArthurGlen
and Bluehouse Capital, real estate
investors in Bulgaria, Croatia,
Greece, Romania and Serbia.
Bond said in November that
the Athens center, which will
Despite the Greek economy, Athens Designer Outlet is on the fast track toward its May opening
accommodate 110 tenants, was because McArthurGlen sewed up financing two years ago.
16 I n te rnational Ou tle t Journ al WINTER 2011
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Project UPDATES
Sterboholy
phase 2 opens
The 7,200-m2 phase 2 of Fashion Arena Outlet Center near Prague
in Sterboholy, Czech Republic, opened
in November 2010, just in time for the
holidays. The additional phase added 37
tenants, bringing the center’s total to 116
units, including eight food court tenants
on the ground floor.
Fashion Arena Outlet Center, which
opened in November 2007, is owned by
Euro Mall Štěrboholy and was developed by TK Development and LMS
Outlets.
The center has attracted 4.5 million
shoppers since its opening, and it is now
drawing from the greater Central Bohemia Region.
“We would like to focus on a wider
catchment area next year so that shoppers from farther away can take advantage of the center,” said Thomas
H. Villadsen, general manager of TK
Development. “At the same time, we
would like to attract more tourists who
can combine a visit to the capital city
with shopping at our center.”
A survey conducted at the center last
summer shows that 90 percent of Fashion Arena visitors come at least twice
a year and 60 percent visit at least four
times a year. Almost 45 percent of the
shoppers travel more than 30 minutes to
the center.
The phase 2 of Fashion Outlet Arena in Sterboholy Czech Republic brings the center’s
total GLA to nearly 25,000 m2 .
Only 27 stores were originally planned
for phase 2, but an additional 10 small
shops were added to the circuit because
of tenant demand. New tenants in the
expansion include Attrattivo, Bepon,
Cartoon Land (Disney), ChocoSky &
Wines, Delsey, Ecco, Fruitisimo Ice
Cream Factory, Gear 1963, Le Creuset,
Lindt, Lisca, M2 Shoes, Pery Shoes &
Bags, Revolution, Sergio Tacchini, Sir
Benni Miles, Speers, Tom Tailor, Tom
Tailor Denim, Tommy Hilfiger, Wildcat
Jeans and Wittchen.
Lacoste, Kosmas Books and Vossen
moved to phase 2 from phase 1.
Belaya Dacha foc
ramps up leasing
with C & W team
Hines International Real Estate
Firm has appointed Cushman & Wakefield as its joint leasing agent for its new
project Outlet Village Belaya Dacha,
Moscow. Cushman & Wakefield will represent Hines in the search for retailers and
food operators, specifically concentrating
on Eastern European and Russian brands.
Outlet Village Belaya Dacha is scheduled to open in September 2011 in the
Moscow area town of Kotelniki.
A joint venture of Hines International
and Belaya Dacha Group, the 38,000-m2
project is more than 75 percent preleased thanks to its in-house team. Even
so, the developers made the decision recently to retain Cushman & Wakefield to
help complete the merchandising plan.
Outlet Village Belaya Dacha will be
home to more than 200 stores, including
such brands as Polo Ralph Lauren, Hugo
Boss, Pal Zileri, Karen Millen, Burberry,
CK Jeans, Naf Naf, Adidas, Reebok
and Levis. The €120 million project is
funded by Hines International Real Estate Fund (HIREF) and Belaya Dacha.
“Outlet centers are a highly popular
and profitable concept in Europe and
the U.S., but do not yet exist in Russia,”
says Lee Timmins, SVP of Hines Russia
and head of the in-house leasing team.
Hines International plans to open Outlet Village Belaya Dacha in the Moscow area “We have investigated the readiness of
town of Kotelniki in September.
the Russian market for the outlet con18 I n te rnational Ou tle t Journ al WINTER 2011
cept and discussed the project and timing with representatives of major brands
and potential tenants. The clear result
of this investigation has been to confirm
that the Russian market has enormous
potential for outlet retail schemes and
very considerable demand for this
format of retail center. Having a project
jointly sponsored by an international
company with a history of success in
this market and an experienced Russian
partner, we have great confidence in the
success of this new project in Russia.”
The project has 4,000 parking spaces,
as well as extensive public transportation
nearby. A new exit to the site from the M5
highway is under construction, and there is
also a direct link to the Moscow boundary
road that’s now under construction.
Hines International’s €16.5 billion
portfolio includes 1,111 properties totaling
more than 450 million sf. Hines offices are
in more than 100 cities and 17 countries.
Hines Russia began its operations in
Moscow in 1991 and has been active in
development, asset management, property
management, marketing, facility management, engineering services, strategic consulting and financial management. As of
September 2010, Hines Russia’s portfolio
included 12 projects totaling more than 4.2
million sf.
Belaya Dacha Group is a holding company with a number of businesses: growing and processing of vegetables, soft
landscaping and landscape design, and
commercial real estate. The holding also
includes the Belaya Dacha Equestrian
Club and the non-commercial organization Narodnoye Predpriyatiye, mainly
responsible for charity programs.
Several planned
FOCs bring focus
to Neinver
Between now and the end of 2012,
Neinver is planning to open several new
outlet centers throughout Europe. The developer has teamed up with MAB Development on two outlet centers in France:
Roppenheim The Style Outlets
is located in the Alsace region, on the
French-German border. The market has
more than 8.4 million upscale consumers and is visited annually by 27 million
tourists. The 27,200-m2 outlet center will
resemble a traditional Alsace village, with
wide, open spaces and state-of-the-art
environmentally friendly architecture. It is
scheduled to open at the end of this year.
Honfleur The Style Outlets, in
Normandy, will be the retail portion of a
future entertainment and leisure complex at Honfleur. The 18,000-m2 center,
scheduled to open in summer 2012, is designed to blend with the surrounding hills.
The center’s catchment is 4.8 million.
In Poland, Neinver is still in the
planning stages with Factory Krakow
and Factory Warsaw Annopol. Factory Coruña, the fifth Neinver outlet
center in Spain, will open this spring,
and in 2012, the developer will open the
Mediterranean-style Algarve The Style
Outlets in Portugal.
(Continued on page 20)
The groundbreaking for D1 Outlet Bratislava featured a dance by the Takeuchi excavators, which was choreographed by Tony Moises, an iconic Slovakian dancer.
Two outlet centers vying to be first in Slovakia
Two projects planned along the
busy D1 Highway in Slovakia are each
hoping to become the first outlet center in that country. Both centers will
attract shoppers from Slovakia, the
Czech Republic, Austria and Hungary,
and both will market to the 4.8 million
people who live within a 90-minute
drive of their FOC sites.
Both projects will draw shoppers
from the capital city of Bratislava, which
has the highest purchasing power
in Slovakia – consumer spending is
expected to increase 38 percent by
2016. Additionally, Slovakia’s flat income
tax rate of 19 percent has attracted
many foreign investors, including VW,
Peugeot, Kia, Samsung and Sony.
Slovakian real estate developer
Realiz is working closely with factory
outlet specialists Rioja Developments
on the €75 million One Fashion Outlet,
which is expected to create 350 jobs.
One Fashion Outlet’s 22-hectare site
is at the Voderady junction of the D1
Highway, 37 km from the capital city
of Bratislava.
Construction of the 16,000-m2 phase
1 is expected to start in the first half of
this year, with the opening planned for
2012. When completed, One Fashion
Outlet will total 36,000 m2 .
Construction for the 8,500-m2 D1
Outlet Bratislava began in November
2010, with plans for space to be
turned over to tenants this summer
and opening this fall. When all phases
are completed, the center’s build-out
could reach 25,000-m2 .
IPEC Group is developing the €35
million D1 Outlet. The center, on a
15-hectare site, could total 25,000 m2
when all phases are completed.
D1 Outlet Bratislava is at the Senec
junction of the busy D1 Highway, 10
km from Bratislava.
WINT ER 2 0 1 1 I nt e r nat i o na l O u t l e t J o ur n a l
19
Project UPDATES
(Continued from page 19)
The race to be
first in Leipzig
is in full swing
The owner of an existing shopping
center just north of Leipzig, Germany,
has received approval from the local
government to convert the project to
Brehna Outlet Park. At the same time,
Stable International, which is planning to
develop an outlet center one exit away in
Wiedemar, just heard good news from an
appeals court in Germany.
In Leipzig, the 23,000-m2 PEP Brehna
shopping center opened in 1990 and did
well because there was a lack of good retail space at the time, according to Robert
Van Den Heuvel of One Outlet Services.
“We have our construction permits
and we’ve already started pre-leasing,”
says Van Den Heuvel, whose company
is a JV partner with the Brehna center’s
owner, ITG of Dusseldorf. Didier
Harm is Van Den Heuvel’s partner in
One Outlet Services; both are former
Nike real estate executives.
The local governments quickly agreed
to the conversion to outlet, apparently
because the redevelopment doesn’t involve adding new space. They also liked
the €60 million investment in a tired
shopping center and they especially were
pleased that the conversion to Brehna
Outlet Park would create 500 jobs.
In Wiedemar, one exit south of
Brehna, Netherlands-based Stable International, which operates Batavia Stad
and Rosada outlet centers there, received
approvals in 2009. However, interim
injunction proceedings brought by neigh-
Construction of the 10,000-m2 Fashion Outlets Wiedemar will begin in April; the
center is scheduled to open in spring 2012.
boring communities delayed the development. Finally, in November 2010, the
highest appeals court in Germany gave
Stable the green light on Wiedemar.
“This is fantastic news” said Stable
director Willem Veldhuizen. “We are
extremely pleased with this decision. The
design for this outstanding project is in
place down to the very last detail, so we
can start construction as soon as possible.”
Construction of the 10,000-m2 Fashion Outlets Wiedemar will begin in
April and the center is scheduled to open
in spring 2012. Fashion Outlet Wiedemar,
which will create 500 jobs, expects to attract more than 1.5 million annual visitors.
Rioja plans FOCs
in six countries
Giles Membrey, president of Rioja
Developments, recently updated IOJ on
projects in six countries the developer is
working on:
Kiev Fashion Outlet, in Kiev, Russia
is a 30,000-m2 project that will be constructed in three phases. Planning and site
work will begin this year, with the opening
scheduled for 2013. The project is being
developed by Rioja and Olvia Group.
MO Fashion Outlet, in Budapest,
Hungary is a 28,000-m2 scheme, also to
be built in three phases. Planning will
start this year; site work next year and
the opening is scheduled for 2013.
Lohja Fashion Outlet in Helsinki is
possibly the first outlet center in Finland.
Rioja is developing the 25,000-m2 project,
also scheduled to open in 2013, with planning starting this year and site work in 2012.
Kolding Fashion Outlet in Denmark
is a 19,000-m2 one-phase project that
Rioja is developing with the Kolding
Council. Site work starts this year and
the center opens in 2012.
Village Des Alpes in Bellegarde Sur
Valserine, France is a 19,000-m2 project next to Junction 10 of A40, which
links Paris to Italy and Lyons to Geneva.
Rioja is developing the project as a JV
with MAB Development.
Rioja is also working with Realiz on
the planned One Fashion Outlet in
Slovakia (see related story, page 19).
FH Belgrade
under way for
autumn opening
Site work on Rioja’s Kolding Fashion Outlet in Denmark begins this year, with the
opening planned for 2012.
20 I n te rnational Ou tle t Journ al WINTER 2011
Fashion House Outlet Centre
Belgrade, the first outlet center in
Serbia, will open in September this year.
Construction on the 30,000-m2 center,
which will open in two phases, began in
October 2010. The project is being de-
veloped by Fashion House Group and
Black Oak Developments.
The first phase of 15,000 m2 will
include 55 tenants, 2,000 parking spaces,
a range of coffee bars and restaurants
and a play area for children. The retail
park will also be home to a non-competitive big-box area, an office park and
a hotel, all set in a village design offering an exceptional shopping experience.
“Introducing the outlet concept in a
new marketplace such as the Republic
of Serbia is as exciting as it comes,” says
Brendon O’Reilly, managing director of
Fashion House Group. “It’s a beautiful
development in a massive, highly-accessible plot, in the middle of the population mass, in a country that doesn’t have
enough retail real estate. Serbian consumers are sophisticated shoppers with
high brand awareness, who will embrace
this new outlet offer very rapidly.”
The €30 million center will be located
between Serbia’s capital city of Belgrade
and its second city, Novi Sad, in the highly visible and easily accessible Retail Park
Indjija. The site on the E75 highway,
between western and eastern Europe,
has an average of 40,000 vehicles passing
daily. The catchment within a 30-minute
drive is more than 3.5 million resident
Serbs, representing more than 50 percent
of Serbia’s total purchasing power.
Quintain launches
leasing campaign
for London foc
Developer Quintain has unveiled detailed designs and plans for
London Designer Outlet (LDO),
The €30 million Fashion House Outlet Centre Belgrade is between Serbia’s capital city
of Belgrade and its second city, Novi Sad, within Retail Park Indjija.
the major retail and leisure element
of its Wembley City development. As
the only outlet center within the M25,
LDO will be London’s first outlet
center, though it is just 14 miles south
of Land Securities’ Galleria Outlet
Centre in Hatfield. Value Retail’s
Bicester Village is an hour away.
Leasing on the 350,000-sf project started in September and already
includes a 25-year lease for Cineworld’s
nine-screen cinema which will seat 1,800
people. Work on the Cineworld site
will start this fall. The cinema is due
to open in 2013, with the outlet center
following a few months later.
According to Quintain, LDO will be
the first of the next generation of outlet
centers to become retail, restaurant
and entertainment destinations within
easy reach of central London and the
South. It is adjacent to two of the most
important sporting and entertainment
venues in the UK – Wembley Stadium
and Wembley Arena.
In addition to Cineworld, the outlet
center will include up to 85 fashion,
sports, homeware and lifestyle tenants
and up to 15 restaurants and bars.
LDO will be the closest outlet centre for 5.8 million people – the largest
catchment in the UK. An estimated
8.4 million live within a 60-minute
drive of Wembley, and the catchment
spend exceeds €4 billion annually.
About 9 million people visit Wembley
City annually, and investors are projecting that visitor numbers could rise
to 21 million a year.
Phil Cottingham, managing director
of retail at Quintain, said the developer’s
vision was to support the synergy of
tenancy, transportation and sheer proximity to London to create a successful
lifestyle destination.
“LDO will reflect the vibrancy of its
urban setting,” Cottingham said. “It will
be enjoyed by both the local population
and the millions of visitors who come to
Wembley every year.” c
Global Outlet Calendar
VRN Spring Outlet Deal Making
March 3-4, Orlando, Fla.
Renaissance Resort at Sea World
ICSC RECon
May 22-25, Las Vegas
VRN Fall Outlet Dealmaking
Sept. 19-20, Secaucus, N.J.
Sheraton Meadowlands Hotel
When it opens in 2013, the 350,000-sf London Designer Outlet will be the major retail
and leisure element of Quintain Development’s Wembley City.
ICSC European Factory Outlets
Conference
October 11-13, Milan
WINT ER 2 0 1 1 I nt e r nat i o na l O u t l e t J o ur n a l
21
Trade Groups
ORDA recognizes top outlet chains
T
he European Outlet Retailers and
Developers Association (ORDA)
recently honored four outlet chains
– Calvin Klein, Nike, Polo Ralph Lauren
and Osprey London – as the best European outlet retailers.
“The introduction of our inaugural
awards is a great step in showcasing
the best in our industry,” said Brendon
O’Reilly, ORDA chairman and managing director of Fashion House Group.
“We hope to include expanded award
categories in future years.”
The 2010 winners and categories were:
l Calvin Klein, best promotional
campaign
l Nike, best marketing program
l Polo Ralph Lauren, best visual merchandising
l Osprey London, best outlet chain
newcomer
O’Reilly explained that the jury was
looking for brands that are “great
examples of how to excel at what they
do. Even those that were short-listed
showed the excellence we know exists
within the outlet sector. We are delighted to have such a high caliber of
winners for our first awards.”
Jeremy Taylor, SVP of Polo Ralph
Lauren Factory Outlets Europe, said the
brand was delighted to be honored.
“We strive to convey Ralph Lauren’s vi-
Neil Thompson (left) and Brendon O’Reilly (right), both of Fashion House Group, congratulate Osprey London’s Graeme Ellisdon for his Best Newcomer award.
sion so our customers may ‘live the movie’
of a unique lifestyle proposition,” he said,
adding that the outlet sector “is essential
to our success in maintaining a seamless
brand projection. To be recognized by colleagues in the industry is truly rewarding.”
As a newcomer to the industry,
Osprey London was delighted to be
nominated in three categories.
Graeme Ellisdon, director of Osprey
London, said he was determined to integrate the outlet channel into his overall
business. Only three years after opening
his first outlet store in McArthurGlen’s
York Designer Outlet in England, “we
have expanded our offer, developed our
customer marketing program, significantly grown our customer database and
opened four further stores in the UK.
“With new product categories and marketing initiatives planned for 2011, three
more stores opening shortly and a number
of additional key locations in the UK
and Europe within our sights, this is very
much just the beginning for our brand.”
The ORDA presentation took place at
the 2010 European Outlet Conference
held in Milan in October. c
Italy gains recognition in global outlet sector
B y F ilippo M affioli,
P re s id ent, ACFOC
T
he last quarter of 2010 has been
busy for the Italian outlet sector.
I was pleased to see that
ACFOC members were in high attendance at the shopping center industry’s most important events of the
year. It was good to see so many at
the Italian CNCC Christmas Meeting.
This was the right occasion for us to
weigh up the year’s results and focus
on the information we picked up at
the ICSC European Outlet Conference, held in Milan in October, and at
Mapic in Cannes, in November.
Both events provided us with valuable
data for our market analysis and highly
22 I n te rnational Ou tle t Journ al WINTER 2011
positive feedback on the Italian FOC
situation.
In Milan, with the much appreciated appearance of the Gucci Group,
we learned that the new interest for
the FOC channel expressed by the
most prestigious names in fashion is
still not very widespread, even in Italy.
But more and more, these brands are
demonstrating an increasingly favorable
attitude toward the format.
Factory outlet centers were in the
spotlight in Cannes, too. All eyes –
from developers to investors – were on
the global outlet sector, especially those
in Italy.
The result was that Italy’s importance
to the outlet sector has now been fully
recognized. Furthermore, thanks to the
opening in November of Sicilia Fashion Village, Sicily, the last Italian outlet
frontier, has been conquered.
We are certain that the new achievements – including the growing interest of
the top brands, the focus on FOC business by all the main stakeholders in the
retail real estate sector, and the significant
territorial coverage – will combine to create an important starting point for 2011.
Now that the format has gained a solid
position as a distribution channel and
in the purchasing habits of Italians, let’s
continue to work hard and innovate! c
ACFOC is the Factory Outlets
Advisory Committee of the Italian
National Council of Shopping
Centers.
European Outlet Mall Fund
Henderson’s European Outlet Mall Fund is a sector-specialist fund with an excellent
performance record investing in prime designer outlet assets in core European markets.
The Fund’s €1.5bn* portfolio comprises 11 pan-European designer outlet centres in Italy,
Germany, France, Austria, the Netherlands, Belgium and the UK – some of the most successful
outlet centres in Europe.
Henderson is a leading fund manager in retail property with assets under management of
€12.2bn* worldwide.
Henderson’s partnership with developer and property manager McArthurGlen brings added
strength, enabling the Fund to benefit fully from collaborative expertise, and secure a vast
number of leading global designer and luxury brands.
*as at September 2010
David Williams
Fund Manager
European Outlet Mall Fund
Tel: +44 20 7818 6423
david.williams@henderson.com
Jamie Acheson
Head of Asset Management
European Outlet Mall Fund
Tel: +44 20 7818 3394
jamie.acheson@henderson.com
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